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Business News

High taxes hit air passenger levels


More than half of the airlines operating in Britain expect fewer people to fly next year because of higher taxes, figures due to be published today were set to show.

Researchers at the lobby group A Fair Tax on Flying Alliance found that 55 per cent of airlines expected passenger numbers to reduce next year, by an average of 5 per cent.

Airlines are concerned about two taxes in particular. Britain's air passenger duty is set to rise next year and the European Union's emissions trading scheme is also due to start in 2012.

The lobbyists claim that the taxes had already lead to fewer people flying in the UK, which imposes higher duties than much of Europe.

The current plan is for air passenger duty to rise at double the rate of inflation next year. The Fair Tax on Flying Alliance said many European countries had opted to phase out their versions of the duty once the EU scheme kicks in.

It was unclear, however, what proportion of the decline in passenger numbers had been due to economic factors.